Cherokee chief candidates make their case: Tribal finance, business ventures key issues in 2023 race
As voters ponder the ballot for executive offices within the Eastern Band of Cherokee Indians next month, they’ll be looking at a list of familiar names.
Incumbent Principal Chief Richard Sneed and Vice Chief Alan “B” Ensley are running for re-election, but both will face stiff opposition from challengers who are quite familiar with tribal government. Michell Hicks, who served three consecutive terms as principal chief from 2003 to 2015, hopes to unseat Sneed in his first election campaign since he declined to stand for re-election eight years ago. Meanwhile, Big Cove Tribal Council Rep. Teresa McCoy, who has spent a total of 22 years in that office, is challenging Ensley.
‘A race about records’
“This is, in my mind, a race about records,” Sneed said at the conclusion of a July 27 debate with Hicks. “Because you as the citizens of this tribe have the unique benefit of knowing both of us and knowing there’s no surprise. There’s no surprise. You know what you’re going to get with me, you know what you’re going to get with Michell.”
Sneed then spent the next three minutes listing out the accomplishments he wants voters to think of when they consider his record — including more than $200 million spent on local projects like community centers and healthcare facilities, getting Kituwah and Cooper’s Creek into federal trust and creating an adult immersion learning program for the Cherokee language. He also touted the tribe’s response to COVID-19 and his efforts to diversify tribal revenues through the creation of LLCs.
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Cherokee One Feather Editor Robert Jumper (left) speaks with principal chief candidates Richard Sneed (center) and Michell Hicks. Holly Kays photo
But Sneed’s record on the LLCs is at the center of the uphill battle he faces to secure re-election. Some voters are concerned that the tribe has overextended itself with out-of-state business commitments while sidelining projects important to the local economy. Recent Tribal Council sessions have featured frequent references to the tribe’s apparently troubled financial situation, with representatives saying that no uncommitted funds remain. Despite the field of six candidates vying for the office of principal chief in June’s Primary Election, Hicks pulled 41.8% of the vote — nearly double Sneed’s 21.8% share.
Though Hicks has not held elected office for eight years, he also has a record to defend. The tribe prospered financially under his watch, with both profits and facilities continually expanding at Harrah’s Cherokee Casino Resort and the Valley River Casino in Murphy opening shortly before his term ended. A referendum vote allowed alcohol sales there in 2009, and in 2012, the tribe reached an agreement with the state to green-light table games , both of which were key inflection points in the casino’s upward trajectory.
But Hicks also had his share of controversies. His administration was criticized for its allegedly liberal use of tribal credit cards , and in 2014, he introduced a controversial budget ordinance — challenged in a lawsuit that was dismissed due to lack of standing — that gave backpay and raises to himself and other elected officials. In 2007, he issued an executive order requiring The Cherokee One Feather to remove the anonymous “Rants and Raves” portion of its opinion section, subsequently removing the erstwhile editor.
The ”race about records” statement could also apply to the vice chief’s race. Both Sneed and Ensley have held their roles for six years after being sworn in following the impeachment and removal of former Principal Chief Patrick Lambert. At the time, Sneed was serving his first term as the elected vice chief and Ensley was nearing the end of 22 years representing Yellowhill on Tribal Council. Since 1987, McCoy has also spent a cumulative 22 years on Tribal Council, sometimes opting to sit out for a term or to run for executive office instead.
Both Sneed and Ensley received a vote of confidence from their constituents when they sought to retain their appointed offices during the 2019 election . Sneed took 55.1% of the vote against McCoy, who ran against him in that race, and Ensley buried challenger Jim Owle with 65.2% of the vote.
But much has changed in four years. Because only two candidates filed to run for vice chief, McCoy and Ensley did not go before voters in the Primary Election this June. But if the chief’s primary is any indication, the tribe’s current executives will face a tough battle at the ballot box.
Fiscal responsibility or financial overcommitment?
Like the rest of the world, the EBCI has weathered a global pandemic and is navigating the societal fallout of measures taken to quell it. At the same time, it has watched its casino monopoly disappear. Temporary gaming facilities are already up in Kings Mountain and Bristol, Virginia, and permanent structures more capable of competing with Harrah’s Cherokee Casinos are only a matter of time.
Unlike town and county governments, the tribal government does not tax and spend. Casino revenues, not taxpayer dollars, fund the array of services offered to tribal members. Sneed has made revenue diversification a hallmark of his administration, setting up multiple LLCs charged with pursuing a variety of moneymaking enterprises on the tribe’s behalf, ranging from hospitality and property management to out-of-state gaming and cannabis.
But word has spread that the tribe is now in financial hot water due to the hundreds of millions of dollars it has pledged to further these enterprises and to complete numerous community projects benefiting its local members. Hicks has sharply criticized Sneed for allowing this situation to play out on his watch.
“We’ve, again, got more money than we’ve ever had, but we’re questioning where’s that next dollar coming from,” Hicks said during the debate. “Because you know what? Yeah, we have diversified. But you know what? We’ve also overcommitted.”
LLC-led economic diversification projects over the last four years include $324 million to purchase the Sports Illustrated Resorts brand and construct associated resorts, a 49.5% stake in a $55 million horse racing facility in Kentucky, $110 million to develop a 200-acre property as a roadside stop along Interstate 40 near Sevierville, a 49.5% stake in a $650 million casino project in Danville, Virginia, $250 million to purchase Caesars Southern Indiana Casino operations in Indiana and $31 million toward launching a cannabis enterprise on the Qualla Boundary. That list is by no means complete.
Sneed, however, maintains that his administration has been “very fiscally responsible.” While the total operating budget has grown, in an interview he said that over the last two years his office has cut out $85 million in “wasteful spending” and pointed out that he has slowly backed off on what percentage of projected casino revenues the budget should count on. The 2020-2021 budget was based on 80% of casino projections, and the 2023-2024 budget is expected to count on 73% of projections.
“I do what is necessary, and I do what is right for the long-term financial wellbeing of the tribe,” Sneed said. “And I, again, point to, from day one, submitting the most fiscally conservative budget in the history of this tribe. Right now, if the two casinos took a 20% hit in revenue, we would not have to do any cost containment. We would not have to cut jobs, programs or services.”
Tribal budgets and tribal enterprises
Meanwhile, Sneed said the Hicks administration had engaged in the dangerous practice of budgeting based on 100% of casino revenues. During the debate, Hicks — who did not return multiple requests for an interview — denied that charge. In response, Sneed read off a list that he said came from the EBCI Department of Finance stating that, from 2009-2012, the tribal budget was based on 98-100% of casino projections.
“I have no further response other than that those numbers are not accurate,” Hicks replied. “It’s a moot point.”
Fact-checking the candidates’ financial claims is difficult because the tribe’s public records law has been interpreted as guaranteeing release of such records only to tribal members, not to non-enrolled members of the media. The Smoky Mountain News has never been permitted to see a copy of the approved budget.
Sneed said that the tribe’s current lack of unrestricted cash is partially because revenue from tribal levy — akin to a sales tax — is being used to fund Qualla Enterprises, the cannabis business. Federal regulations prevent the tribe from using gaming dollars for that purpose, but using tribal levy dollars displaces funds that were going toward other programs. Sneed also pointed to Tribal Council spending decisions. Over the past decade, he said, Council has approved $700 million worth of projects, far more than the tribe’s capacity to execute — especially with interest rates much higher than they were a few years ago. For that reason, Sneed has put the brakes on projects that were until recently expected to move forward soon.
“[Hicks] can criticize that if he wants, but had we not done that, I guess he would be criticizing the really high interest rate we would have been paying,” he said.
But Sneed’s opponents say the situation is much more dire than that. Hicks decried the fact that millions of dollars are sitting in tribal coffers but collateralized in loans, and therefore unusable.
“We can’t access it,” he said. “Guess who owns it? The bank does. That’s the issue.”
Tribal debt was also an election issue in Hicks’ last campaign in 2011. At that time, the tribe owed $57.2 million on the Cherokee Central Schools complex and $10.8 million on the Sequoyah National Golf Club, and was on the hook for $8.9 million for a series of loan guarantees. Opponents also wanted to peg the $650 million line of credit for the casino expansion project then underway on Hicks, but his administration said that because the tribe was not legally liable for the casino’s debt, that figure should not be lumped in with tribal debt. At no time in his tenure, Hicks said, was the casino allowed to collateralize tribal dollars.
Casinos and cannabis
McCoy is running against Ensley, not against Sneed as she did in 2019, but she is running in opposition to the status quo he has created and said in an interview that she hopes to serve alongside Hicks. The tribe is currently paying only interest on some of its loans, she said, charging that Sneed’s administration “has taken us from success to being almost unable to borrow money.” Sneed did not reply to a follow-up question asking whether the tribe is making full principal payments on its loans.
“That can change,” McCoy said. “I have plans, and that’s what I bring to the table.”
McCoy said she would focus initially on projects that promise a fast return and then “openly discuss” projects and plans for long-term returns. But none of those projects, she said, would involve gaming.
“I’m not interested in spending any more of our money, Eastern Band of Cherokee Indians money, on gaming,” she said. “That is not diversification.”
Ensley, who did not return multiple requests for an interview, said during the debate that he agrees with the need to “diversify away from gaming” and that the tribe needs to put money back into the town to increase revenues from tribal levy.
“This town lived and grew off the tribal levy, for police, fire and sanitation,” he said. “I think we’ve got to diversify back into young entrepreneurship.”
Sneed has warned that tribal members often have a false sense of normalcy when it comes to the pace and magnitude of returns to expect on business ventures. Casino gaming is one of the most lucrative businesses there is, he said, and the EBCI’s casinos are some of the most lucrative casinos there are.
“We’ve become addicted to gaming revenue,” he said.
But McCoy believes there’s another business opportunity offering large, immediate returns — Qualla LLC. The cannabis enterprise started production of medical marijuana this year, and in September tribal members will vote on a referendum question asking whether they want to legalize recreational use on the Qualla Boundary. Because the state of North Carolina has not yet legalized either medicinal or recreational use, the launch of retail sales has yet to begin. The LLC is looking for a legal way to move product from the production facility at Coopers Creek to the dispensary in Cherokee.
Funding and accountability for Qualla Enterprises has been a contentious issue in Tribal Council chambers, with Sneed saying he wholeheartedly supports the cannabis project in concept while questioning the numbers its leaders have offered and demanding increased transparency with his office. McCoy has no such reservations.
“If you’re looking for a fast return, right now that’s the only way to do it,” she said. “You grow medicine. You provide 400 jobs. Those empty shops we talk about in town get filled up with those young entrepreneurs who want to have a donut shop, a restaurant.”
The tribe should also look to other ventures as well, she said, including maximizing ecotourism potential at home.
Regarding cannabis, Hicks was more cautious in his comments, saying that the science behind medicinal cannabis is “really intriguing.” Both he and Ensley deferred to the will of the people on the recreational use issue, though Hicks said that geographical parameters should be put in place if the measure passes.
“We need to create parameters that keep this out of the sight and the minds of our children, because I don’t think it sends the right message,” he said.
Debating transparency
Throughout the election season — and throughout the tribe’s movement toward economic diversification — transparency has been a key issue. Often, those in office discuss the need for confidentiality when discussing numbers and partnership opportunities with various companies. The tribe is, in many senses of the word, a business. And in the business world, nobody announces a deal until it’s signed and final. Certainly, nobody opens up their books for public inspection.
But the EBCI is more than just a business, and tribal members are more than “the public.” They’re also shareholders in the corporation that is the EBCI — and they want to know how, and why, their money is being spent.
“To me, every enrolled member is a shareholder, and they should be entitled to every bit, 100% of the information that they request at any time,” said Ensley.
None of the other candidates for chief or vice chief disagreed with that assessment, but there was uncertainty about how to carry it out. Certainly, some information is sensitive, or embargoed — an individual “shareholder” might have a right to know, but should the information be broadcast online, for the whole world to see?
During the debate, Sneed said he would support quarterly and monthly reports going out to the people and floated the idea of creating a login for online broadcasts of Tribal Council meetings, accessible only to enrolled members.
“We’ve experienced repeatedly that when we do discuss business items on air, you find out that the whole rest of the country is watching,” he said.
McCoy said she prioritizes free press and open access to information, with the exception of trade secrets and sensitive business negotiations that must be discussed only in closed session.
“I believe in free press,” she said in the debate. “I’m that person. I believe that if you give people the information, they will make the right decision.”
Hicks focused his discussion of the shareholder concept on members’ right to know how any revenues gained from new projects might impact them. Tribal members receive per capita distributions derived from 50% of the revenues from the casinos in Murphy and Cherokee. Though Tribal Council did recently approve a resolution , introduced by Sneed, to explore granting per capita payments from commercial sports betting proceeds, as of now none of the tribe’s other commercial ventures yield per capita distributions.
“There’s no revenue plan for some of these enterprises” Hicks said. “Should have been done up front, and that should have been the chief’s responsibility.”
According to Sneed, the election is about records. But according to Hicks, it’s about something completely different.
“We have to do a better job of listening, and, again, I think that’s probably one of the things I’ve heard the loudest in the community, outside of the financial crisis we’re in, is our community wants their voice back,” he said. “I promise you, you will get your voice back.”
Meet the candidates
Principal Chief
Michell Hicks
Hicks was elected to the office of principal chief three times — 2003, 2007 and 2011 — before declining to stand for re-election in 2015. Since then, he founded the business consulting firm Chief Strategy Group, where he’s the president. Prior to entering politics, Hicks was the tribe’s executive director of budget and finance. He holds a bachelor’s degree in business administration from Western Carolina University and an associate degree in accounting from Southwestern Community College, and he has been a Certified Public Accountant for more than 20 years.
Richard Sneed
Sneed has served as principal chief for six years. After winning the 2015 election for vice chief, he was sworn in to replace former Principal Chief Patrick Lambert following his removal by impeachment and then won election in 2019. Prior to the 2015 election, Sneed spent 11 years as an industrial arts teacher at Cherokee High School, 14 years as a pastor and owned Cornerstone Automotive for five years. He is a veteran of the U.S. Marine Corps, where he served four years.
Vice Chief
Alan “B” Ensley
Ensley represented Yellowhill on Tribal Council from 1995 to 2017, when he was appointed to the role of vice chief to fill the vacancy left when Sneed was sworn in as principal chief. He is an alumnus of Cherokee High School and worked in the family logging business prior to entering politics.
Teresa McCoy
McCoy was first elected to represent Big Cove on Tribal Council in 1987, and since then she has held the seat for 22 years. A graduate of Cherokee High School, she also attended Southwestern Community College and Western Carolina University for three years.
Get ready to vote
Key dates are coming up regarding registration and voting for the 2023 General Election Sept. 7.
• Registration closes at 4 p.m. Friday, Aug. 4, for the General Election and 4 p.m. Tuesday, Aug. 8, for the referendum election occurring on the same day.
• Early voting will be held 9 a.m. to 4 p.m. Mondays through Fridays, Aug. 7-25, as well as Saturday, Aug. 26, and Monday, Aug. 28.
• Absentee ballot requests must be made by Tuesday, Aug. 15.
For more information, contact 828.359.6361 or visit ebci.com/government/election-board.
Watch the debate
Debates between candidates for all legislative and executive offices up for election this year were held last week, hosted by The Cherokee One Feather. They are available online at bit.ly/EBCIdebates23 and on the EBCI Communications Facebook page.
